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Technology Stocks : TranSwitch Corp: Will they get Zenith Business?
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To: tejek who wrote (638)6/14/2002 8:02:00 PM
From: The Ox  Read Replies (3) of 669
 
Transwitch sells chips to telecom carriers and they have stopped spending money on new products. One look at the lower revenues being seen by Nortel and Lucent should paint the picture clearly. There simply has been a halt to all major spending in this sector and what little spending that has been seen is buying existing products at very distressed prices. Basically, TXCC is a business without any major customers at this point in time. My view is that this industry won't pickup substantially until 2004 at the earliest and that it's very possible that it'll be 2005 before solid growth is expected. If my memory isn't failing me, I believe Lucent recently said they expect fairly flat revenue for 2003 vs 2002. If they aren't being too pessimistic, then TXCC will have a long wait before products are being ramped up in this sector. I think we will see plenty of mergers where the big fish will gobble up the small fries at a substantial discount to fair market value.
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